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Tax returns for divorce case

Divorce normally not a fun experience. There are often various unpleasant emotions, and you even may have to pay legal fees, settlement costs, and sometimes, tax preparation fees. I have been approached on many occasions by spouses needing a tax return filed as part of the requirements of a divorce-court proceeding. One of the many issues with these sorts of engagements is that portions of the return may be questioned by the other party’s legal representation.

It is important that you are clear with your CPA regarding what these returns will be used for. Some CPAs do not want to be involved in a legal battle and will not provide follow-up support for these returns. Make sure that your CPA knows of potential complexities, push-back from the opposing party, etc. and is available to consult further should the other party request tax-related details, adjustments, etc.

Make sure to also discuss hourly rates – some forensic accountants in NY and SF will charge $450 per hour, while others (in less expensive states) will charge as low as $300 per hour. This can make a huge difference, especially if many pages of financial records need to be reconciled.

Here are some tips:

  • For married filing separate returns, you need your spouse’s name and DOB.
  • Do not claim the same child more on more than one person’s return. Whoever had the child a majority of the time should be getting the deduction
  • If you are in a community property state, you are required to “allocate” income, so this means having access to the other party’s income information in order to prepare correct returns

Contact us below if you need assistance with any of this.

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